Signaling quality through gifts:implications for the charitable sector

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Autor/in:
Erscheinungsjahr:
2017
Medientyp:
Text
Schlagworte:
  • Charitable giving
  • Donation
  • Charitable donations
  • Volunteers
  • Nonprofit
  • Charity
  • Charitable giving
  • Donation
  • Charitable donations
  • Volunteers
  • Nonprofit
  • Charity
Beschreibung:
  • A popular belief amongst fund-raisers is that potential donors are more generous when provided gifts as part of the solicitation request and there is a growing body of experimental research supporting this belief. To date, such behavior has been modeled through the lens of gift-exchange and reciprocity. We provide an alternate rationale for gift-giving by nonprofit organizations based on the signaling model of Spence (1973). We first show that in the presence of uninformed donors there exists a separating equilibrium under which high quality charities expend scarce resources to signal quality and receive higher donations. We then explore how gift-giving and competition amongst charities impacts net public good provision. In doing so, we highlight a perverse effect - competition amongst charities can lead to lower public good provision when the likelihood a charity is of high quality is high and/or when the difference in quality across high and low type firms narrows.
  • A popular belief amongst fund-raisers is that potential donors are more generous when provided gifts as part of the solicitation request and there is a growing body of experimental research supporting this belief. To date, such behavior has been modeled through the lens of gift-exchange and reciprocity. We provide an alternate rationale for gift-giving by nonprofit organizations based on the signaling model of Spence (1973). We first show that in the presence of uninformed donors there exists a separating equilibrium under which high quality charities expend scarce resources to signal quality and receive higher donations. We then explore how gift-giving and competition amongst charities impacts net public good provision. In doing so, we highlight a perverse effect - competition amongst charities can lead to lower public good provision when the likelihood a charity is of high quality is high and/or when the difference in quality across high and low type firms narrows.
Lizenz:
  • info:eu-repo/semantics/closedAccess
Quellsystem:
Forschungsinformationssystem der UHH
Interne Metadaten
Quelldatensatz
oai:www.edit.fis.uni-hamburg.de:publications/f48be647-58b1-4512-9476-e2560c828d6a